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Re: annuitize TIAA-CREF, or take the money and run ?
Old 10-04-2006, 03:05 PM   #21
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Re: annuitize TIAA-CREF, or take the money and run ?

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Originally Posted by JohnEyles
But still, if I run their calculator, and make the very conservative assumptions
of 4% and 7% ROR on TIAA and CREF respectively (I'm split 1/3 and 2/3),
I get a payment which starts at 5.25% of my current accumulation, and keeps
pace with 2.5% inflation. That's starting soon (when I turn 54yo).

And I'm impressed by Brewer's faith in their continued solvency.
The 403 annuity you have is far superior in many respects to the ones that members of the general public can buy from TIAA-CREF.

TIAA-CREF is one of the largest, most solvent mutual insurers in the country. They have their faults (less so if they flush the current CEO, IMO), but they are on a par with about 3 or 4 other large mutual life companies as far as their credit quality goes (IMO, of course).
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Re: annuitize TIAA-CREF, or take the money and run ?
Old 10-04-2006, 03:48 PM   #22
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Re: annuitize TIAA-CREF, or take the money and run ?

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Originally Posted by brewer12345
The 403 annuity you have is far superior in many respects to the ones that members of the general public can buy from TIAA-CREF.

TIAA-CREF is one of the largest, most solvent mutual insurers in the country. They have their faults (less so if they flush the current CEO, IMO), but they are on a par with about 3 or 4 other large mutual life companies as far as their credit quality goes (IMO, of course).
Never said CREF has no money.............they got all the doctors and professors and teachers in the US...............

But, STILL WAITING on the customer service..............I'm beginning to think they know I am going to move the funds, and are stalling............
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Re: annuitize TIAA-CREF, or take the money and run ?
Old 10-04-2006, 04:05 PM   #23
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Re: annuitize TIAA-CREF, or take the money and run ?

Quote:
Originally Posted by brewer12345
This is one of the few annuites out there that I think can be a good idea.. . the basic proposition here is that you would retain the investment risk (given the CREF investments), but you would be pooling your longevity risk with the other TIAA-CREF annuitants, and the whole thing would be backed by TIAA's capital.. .Unfortunately, it is only open to the 403 participants with TIAA-CREF.
While AIG is no TIAA, and it doesn't have the fantastic health benefit, Vanguard does offer a similar variable payout annuity. You can get a quote if you select "Variable income payment" on their website:

http://www.aigretirementgold.com/vli...=RequestaQuote

From what mortality assumptions I can tease out of their quotes, it looks like it does not make much sense for a 54 year old to annuitize since the expenses are eating up their mortality benefit for the first few years.
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Re: annuitize TIAA-CREF, or take the money and run ?
Old 10-04-2006, 04:06 PM   #24
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Re: annuitize TIAA-CREF, or take the money and run ?

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Originally Posted by bongo2
While AIG is no TIAA, and it doesn't have the fantastic health benefit, Vanguard does offer a similar variable payout annuity. You can get a quote if you select "Variable income payment" on their website:

http://www.aigretirementgold.com/vli...=RequestaQuote

From what mortality assumptions I can tease out of their quotes, it looks like it does not make much sense for a 54 year old to annuitize since the expenses are eating up their mortality benefit for the first few years.
AIG is a much less solid credit, IMO, and the payout annuities they offer (fixed and variable) are different animals from the ones offered by TIAA-CREf to 403 plan participants.
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Re: annuitize TIAA-CREF, or take the money and run ?
Old 10-04-2006, 04:33 PM   #25
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Re: annuitize TIAA-CREF, or take the money and run ?

How is it different?
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Re: annuitize TIAA-CREF, or take the money and run ?
Old 10-04-2006, 04:36 PM   #26
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Re: annuitize TIAA-CREF, or take the money and run ?

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How is it different?
Because with a "captive" audience, and many billions of dollars, their actuaries can customize payouts and options the average Joe can't get.....................

It's kind of like the pay increases the CEO's get from public companies that aren't making money, versus the non-existent bonuses the middle management gets when the company is not making money............
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Re: annuitize TIAA-CREF, or take the money and run ?
Old 10-05-2006, 09:43 AM   #27
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Re: annuitize TIAA-CREF, or take the money and run ?

OK, I understand that TIAA-CREF is different from AIG-Vanguard, but what are the differences in the product? I don't want to beat this to death, but the Vanguard product seems to be exactly what brewer mentioned: you keep the investment risk, and pool the mortality risk. I see from looking around the internet that variable payout annutities are offered by several life insurance companies, so what makes TIAA's so special? Is it the low fees and benevolent management, or is there something that makes it a "different animal?"
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Re: annuitize TIAA-CREF, or take the money and run ?
Old 10-05-2006, 09:51 AM   #28
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Re: annuitize TIAA-CREF, or take the money and run ?

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Originally Posted by bongo2
OK, I understand that TIAA-CREF is different from AIG-Vanguard, but what are the differences in the product? I don't want to beat this to death, but the Vanguard product seems to be exactly what brewer mentioned: you keep the investment risk, and pool the mortality risk. I see from looking around the internet that variable payout annutities are offered by several life insurance companies, so what makes TIAA's so special? Is it the low fees and benevolent management, or is there something that makes it a "different animal?"
No doubt there are some slight differences in the products, but probably nothing major. The difference is in the issuer. With TIAA-CREF, you are dealing with a mutual company where all policyholders share the risk and the rewards right down to the last dollar of capital. With AIG, you are dealing with a stock company that owns the capital and is in it to make a profit.
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Re: annuitize TIAA-CREF, or take the money and run ?
Old 10-05-2006, 02:00 PM   #29
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Re: annuitize TIAA-CREF, or take the money and run ?

Ah, now I understand what you're saying.
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Re: annuitize TIAA-CREF, or take the money and run ?
Old 10-05-2006, 02:01 PM   #30
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Re: annuitize TIAA-CREF, or take the money and run ?

Just out of curiosity, do you know of any mutual life insurers with a similar product available to everyone that you would recommend?
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Re: annuitize TIAA-CREF, or take the money and run ?
Old 10-05-2006, 02:08 PM   #31
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Re: annuitize TIAA-CREF, or take the money and run ?

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Just out of curiosity, do you know of any mutual life insurers with a similar product available to everyone that you would recommend?
There are mtual insurers who sell VAs out there but most of them are a LOT more expensive taht TIAA-CREF's offerings. VAs are also very much a scale business, as some of the smaller and mdsized players are finding out. So you have to choose carefully because most mutual companies don't consider VAs to be their core business, so you are potentially at risk of being in an "orphan" VA if they decide to get out of that business.

The only company that comes to mind that is both mutual and committed to the VA business is Pacific Life. They aren't as solid as TIAA-CREF, but almost nobody is. I think Pac Life is a good, well run company that I would be OK taking exposure to. Having said all that, I don't think they sell direct, and their offerings tend not to be the cheapest.
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Re: annuitize TIAA-CREF, or take the money and run ?
Old 10-05-2006, 02:15 PM   #32
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Re: annuitize TIAA-CREF, or take the money and run ?

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Originally Posted by brewer12345
There are mtual insurers who sell VAs out there but most of them are a LOT more expensive taht TIAA-CREF's offerings. VAs are also very much a scale business, as some of the smaller and mdsized players are finding out. So you have to choose carefully because most mutual companies don't consider VAs to be their core business, so you are potentially at risk of being in an "orphan" VA if they decide to get out of that business.

The only company that comes to mind that is both mutual and committed to the VA business is Pacific Life. They aren't as solid as TIAA-CREF, but almost nobody is. I think Pac Life is a good, well run company that I would be OK taking exposure to. Having said all that, I don't think they sell direct, and their offerings tend not to be the cheapest.
You are correct, they do not sell direct, and their total eexpense ratios inside are 2.40-2.85%, depending on if you take riders or whatnot................

American Legacy are VA's run by American Funds. Their expense ratios are about .50% less than Pacific Life or Hartford...............bottom line, VA's are expensive and unneccesary for a lot of folks, but have their place..................
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Re: annuitize TIAA-CREF, or take the money and run ?
Old 10-12-2006, 03:11 PM   #33
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Re: annuitize TIAA-CREF, or take the money and run ?

I have a current state retirement plan with TIAA-CREF and IRAs with another provider. The state plan is federal tax deferred, but after tax for state tax, so when I start taking money out I'll have to pay federal tax, but it will be free of state tax. I had considered rolling it over into an IRA, but I think that this would make my IRAs difficult wrt tracking the tax as I'd have comingled tax deferred and state after tax money. My question is this, is it simpler just to leave the money with TIAA-CREF, take money out and only pay federal tax unitl I've spent it down and then can tap the IRAs.
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Re: annuitize TIAA-CREF, or take the money and run ?
Old 10-12-2006, 04:28 PM   #34
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Re: annuitize TIAA-CREF, or take the money and run ?

wow, that sure would seem complicate matters. complications aside, tiaa-cref is not a bad place to be ... any particular reason you're wanting to move out?
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Re: annuitize TIAA-CREF, or take the money and run ?
Old 10-13-2006, 08:55 AM   #35
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Re: annuitize TIAA-CREF, or take the money and run ?

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wow, that sure would seem complicate matters. complications aside, tiaa-cref is not a bad place to be ... any particular reason you're wanting to move out?
No particular reason, just looking to "simplify" and get all my funds with a single company. It looks like the simple option is to leave the money in TIAA-CREF so the state fund and my IRAs are not co-mingled and its a simple matter to do the taxes.
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Re: annuitize TIAA-CREF, or take the money and run ?
Old 10-13-2006, 10:57 AM   #36
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Re: annuitize TIAA-CREF, or take the money and run ?

I am surprised that you are even debating this when you get free health insurance for what could be 35-40 years..This is worth thousands a year. I have never even heard of this before.
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Re: annuitize TIAA-CREF, or take the money and run ?
Old 10-15-2006, 08:01 PM   #37
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Re: annuitize TIAA-CREF, or take the money and run ?

Quote:
Originally Posted by New Thinking
I am surprised that you are even debating this when you get free health insurance for what could be 35-40 years..This is worth thousands a year. I have never even heard of this before.
I think perhaps you are confusing 'nun' with me; I am NOT even debating it.
I think the state legislature came to their senses and now you have to have
20yrs of service (not 5yrs as I did), but I still think you are eligible after 5
but must pay a pro-rated cost between 5 and 20.
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Re: annuitize TIAA-CREF, or take the money and run ?
Old 10-25-2006, 01:05 PM   #38
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Re: annuitize TIAA-CREF, or take the money and run ?


As I mentioned a couple weeks ago (I'm keeping this in the same
thread), I am going to annuitize my TIAA (leave CREF for now) in
order to get health insurance.

But when I look at the payout for TIAA, it seems remarkably bad -
as compared to a SPIA for example; thus I'm thinking to annuitize
only a small amount (for the health insurance) and move the
remainder over to CREF.

I'm curious if my analysis makes sense. TIAA-CREFs "illustration"
says that my $64K in TIAA will yield a lifetime income of $336/mo.
This seems to be independent of anything I specify about TIAA's
ROR, since apparently it's all determined by their "vintage" system
(the ROR is determined by when the money was put IN to TIAA).

If I use the Vanguard/SPIA calculator, I get $364/month.

Brewer may argue if the extra 10% is worth the lower trustworthiness
of AIG as compared to TIAA-CREF. But that's not the point, since THIS
money can't be rolled to Vanguard anyhow. This point is, it says TIAA
is kinda a rotten deal and I oughta roll most of it to CREF, where payouts
are quite respectable (as compared to a SPIA).

Make sense ?


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Re: annuitize TIAA-CREF, or take the money and run ?
Old 10-25-2006, 03:19 PM   #39
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Re: annuitize TIAA-CREF, or take the money and run ?

Quote:
Originally Posted by JohnEyles
As I mentioned a couple weeks ago (I'm keeping this in the same
thread), I am going to annuitize my TIAA (leave CREF for now) in
order to get health insurance.

But when I look at the payout for TIAA, it seems remarkably bad -
as compared to a SPIA for example; thus I'm thinking to annuitize
only a small amount (for the health insurance) and move the
remainder over to CREF.

I'm curious if my analysis makes sense. TIAA-CREFs "illustration"
says that my $64K in TIAA will yield a lifetime income of $336/mo.
This seems to be independent of anything I specify about TIAA's
ROR, since apparently it's all determined by their "vintage" system
(the ROR is determined by when the money was put IN to TIAA).

If I use the Vanguard/SPIA calculator, I get $364/month.

Brewer may argue if the extra 10% is worth the lower trustworthiness
of AIG as compared to TIAA-CREF. But that's not the point, since THIS
money can't be rolled to Vanguard anyhow. This point is, it says TIAA
is kinda a rotten deal and I oughta roll most of it to CREF, where payouts
are quite respectable (as compared to a SPIA).

Make sense ?


John,

I'm a little confused. Does the TIAA retirement income illustration you mention above [$336] use your actual vintage interest rates?

Could you elaborate more on how the CREF payouts are better than the TIAA payouts? Are you using the usual 4% AIR for the CREF payouts?

IIRC, to get the free health bennies, you have to start withdrawing money from your TC accounts [403(b)], right? So your choices are either systematic withdrawals, which you stated earlier that you didn't want to do b/c that runs the risk of depletion and cancellation of health bennies. Or you can annuitize some of your TC accumulation, which is either the 1) TIAA standard payment method, 2) TIAA graded payment method, or 3) variable payouts from the 4 CREF stock, 2 CREF bond, MM, or TIAA Real Estate accounts. Is this correct?

- Alec
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Re: annuitize TIAA-CREF, or take the money and run ?
Old 10-25-2006, 06:55 PM   #40
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Re: annuitize TIAA-CREF, or take the money and run ?

Quote:
Originally Posted by ats5g
I'm a little confused. Does the TIAA retirement income illustration you mention above [$336] use your actual vintage interest rates?
I think it does, because (a) it HAS that information, and, (b) if I change the AIR for
TIAA it does not affect the payout (apparently it's ignoring what I put in).

Quote:
Could you elaborate more on how the CREF payouts are better than the TIAA payouts? Are you using the usual 4% AIR for the CREF payouts?
Well, they are simply higher. No, for CREF I am using about 7%. I have about $130k
and if I start soon at 54yo the 3%-inflation adjusted payout is about $600/mo.
Vanguard/AIG SPIA gives about $500/mo.

Quote:
IIRC, to get the free health bennies, you have to start withdrawing money from your TC accounts [403(b)], right? So your choices are either systematic withdrawals, which you stated earlier that you didn't want to do b/c that runs the risk of depletion and cancellation of health bennies. Or you can annuitize some of your TC accumulation, which is either the 1) TIAA standard payment method, 2) TIAA graded payment method, or 3) variable payouts from the 4 CREF stock, 2 CREF bond, MM, or TIAA Real Estate accounts. Is this correct
Sounds about right. The ORP-4 form which must be filled out says "in order to be eligible,
the ORP participant must be vested, that is, contributed for five or more years to the
ORP, ... and be in receipt of an ORP monthly retirement annuity benefit". That seems
a little indefinite about whether it must be a "lifetime annuity" or not; but I don't care,
I'm just gonna annuitize a small portion of TIAA and move the remainder over to CREF.

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